Alaska Politics Blog : Alaska Newsreader: Special Exxon Valdez edition

Alaska Newsreader: Special Exxon Valdez edition

Posted by Alaska_Politics

Anchorage Daily News

Posted: June 25, 2008 - 4:10 pm

From Kathleen McCoy in Anchorage --

Newsreader scoped the national and international press and Alaska blogs for reaction to today’s Exxon Valdez ruling.

What the decision didn’t settle:

> Whether maritime companies are responsible for a skipper’s bad behavior: According to John Kimball, a partner with US law firm Blank Rome, the court did not decide on the issue of whether the owner could be held liable for punitive damages based on acts of the ship’s master or other employees. “That issue will continue to vex the lower courts,” Kimball said. Lloyd’s List maritime news, Washington Post

> Whether the one-to-one ratio on punitive and compensatory damages will apply outside maritime law. In the Exxon case, the court was acting as a state appellate court typically might, assessing the reasonableness of the punitive award under the common law rather than asking whether it violated constitutional due process protections. It is not clear, then, what effect the decision will have in cases presenting the constitutional question. The New York Times

Reaction from those opposing the court’s decreased damages:

> Dissenter Justice John Paul Stevens says the Exxon spill called for “moral condemnation.” “In light of Exxon’s decision to permit a lapsed alcoholic to command a supertanker carrying tens of millions of gallons of crude oil though the treacherous waters of Prince William Sound, thereby endangering all of the individuals who depended upon the sound for their livelihoods, the jury could easily have given expression to its moral condemnation of Exxon’s conduct in the form of this award.” The New York Times

> Dissenter Justice Ruth Bader Ginsburg called the decision “lawmaking.” The court made a new rule, that punitive damages may not exceed what the company already paid in compensation for victims' economic losses. "The new law made by the court should have been left to Congress," Ginsburg wrote. Legal News

> Decision could leave a powerful aftertaste. The decision is likely to feed into rising public and congressional discontent with the oil industry as oil and gasoline prices rise to records. Wall Street Journal

> An arrogant Exxon wasn’t ready for the spill. The Prince William Sound spill was the largest in the US and happened in what the national Environmental Protection Agency (EPA) called “one of the most pristine and magnificent natural areas in the country”. On top of that, many objected to the perceived arrogant tone of Exxon’s response to the disaster. Lawrence Rawl, who was the then company’s chairman, did not take the first flight to Alaska, but left frontline management of the crisis to subordinates. The EPA concluded: “Exxon was not prepared for a spill of this magnitude.” Financial Times

> Affected Kodiak residents express disappointment. Kodiak attorney Matt Jamin, who represents plaintiffs in the case, called the decision “A terrible blow to the people of Alaska.” Mary Jacobs, a Kodiak salmon fisherman at the time of the oil spill and one of the many local plaintiffs, called the decision “disappointing,” KMXT, Kodiak

> Palin, LeDoux (R-Kodiak), react. “This is devastating. I cannot believe how Exxon Mobil has succeeded in hurting thousands of Alaskans who have been waiting nearly 20 years for justice. I am deeply saddened by the court ruling,” said Gabrielle LeDoux.

“While the decision brings some degree of closure to Alaskans suffering from 19 years of litigation and delay, the court gutted the jury’s decision on punitive damages,” said Gov. Sarah Palin. Juneau Empire

> Alaska delegation gives united dissent. "Today's ruling adds insult to injury to the fishermen, communities and Alaska natives who have been waiting nearly 20 years for proper compensation following the worst environmental disaster in our nation's history," said a joint statement issued by Sens. Ted Stevens and Lisa Murkowski and Rep. Don Young. Washington Post

> Sen. Patrick Leahy calls court decision a misread of the Constitution. “Today the Supreme Court has given Exxon Mobil Company a $2 billion windfall by reading into the Constitution a protection for corporations that simply does not exist. This is activism, pure and simple." Washington Post

> Jury was within the law to punish a captain’s risky behavior. Stanford University law professor Jeffrey Fisher said nothing in longstanding maritime law prevented the jury from punishing Exxon for the reckless acts of the vessel's captain. USA TODAY

> Greenpeace called the ruling “a mockery of justice.” “For the Court to require a company that recorded a 2007 profit of $40.6 billion and that posted the highest quarterly results in U.S. corporate history in February to pay a mere $500 million in punitive damages to the affected Alaskans makes a mockery of justice,” said John Passacantando. Common Dreams.org

"The US public should know our companies are not being held to account and that the Supreme Court will defend these corporations and their bad actions and not the citizens of the US," Passacantando said. English Aljazeera.net

> Exxon proves the benefits of the endless appeal. The decision strikes yet another blow against what is essentially the capital punishment of the civil justice system, in a long-running campaign by Exxon and other big companies to try to abolish these sorts of awards entirely. Punitive damages put the real teeth in the legal system, and serve as an ad-hoc form of regulation by standing as a potential deterrent to all sorts of egregious behavior. That, of course, is why business really hates them. Mother Jones

Reaction from those who support the decision:

> Exxon stock falls slightly on news. Shares of Exxon Mobil , a Dow component, fell 1 percent to $86.08 as investors shrugged off news of a court ruling that lowered the penalty the oil giant has to pay for its role in a 1989 maritime oil spill. Forbes.com

> The unpredictability of large jury verdicts weighed heavily in the decision. The court's problem was that occasional large jury awards create an unpredictability that is at odds with the desire for fairness and consistency in the court system. Based on the median payouts in punitive damages for maritime cases, the court held that the ratio of punitive damages should not be greater than 1:1 U.S. News

> Exxon Mobil chairman says he has regrets: Rex W. Tillerson called the 1989 oil spill "a tragic accident and one which the corporation deeply regrets." He did not comment specifically on the ruling. Washington Post

>The US Chamber of Commerce calls the ruling a "victory." "For years the chamber has argued that punitive damages are too unpredictable and unfair, and today the court agreed," the chamber's president Tom Donohue said in a statement. AFP

> Ruling could lead to tighter restrictions on punitive damages. Robin Conrad, head of the U.S. Chamber of Commerce's litigation arm, said that although the ruling is limited to maritime disputes, it could ultimately lead to tighter restrictions on punitive damages. "Limiting punitive damages to no more than the amount of a compensatory award will go a long way in cabining unpredictable punitive damages," Conrad said. CNNMoney.com

Reactions from Alaska’s blogosphere:

> Let Exxon pay our fuel bills this winter. Model the system after the CITGO program that has helped out rural Alaska immeasurably in the last two years and let Exxon Mobil help heat homes until they've reached the 11 million gallon mark. Then they've paid their tab. Fiery Blazing Handbasket

> Plaintiff awards will vary widely. Early stories listed damages at $15,000 for plaintiffs “which is incorrect; there are several different ‘classes’ of plaintiff, based on a huge variety of variables, and some will receive a few dollars some many multiples of the average. Kodiak Konfidential.

> Don’t forget this. Don’t forget this when they tell you Pebble Mine won’t destroy the Bristol Bay fishery. Don’t forget this every time we negotiate with the oil companies about anything. Don’t forget this every time you see a warm fuzzy TV commercial, or see oil company logos every time you turn around. Don’t forget that anyone in our state to develop finite natural resources is here for the money. Period. And don’t forget this when you vote in November. Mudflats

> Boy, it sucks. Although it did result in at least one clever comment -- something about Exxon ringing up the front desk and asking the receptionist to take the punitive damages money out of petty cash. Own the sidewalk

> Put this into perspective. Anchorage radio host Shannyn Moore, a plaintiff in the case said "For Alaska to continue to do business with Big Oil and Exxon as a State, without insisting on justice for us, is like letting the guy that date raped your daughter live in your basement...shameful." Alaska Report

Alaska Politics Blog

Contributors

Features

Archive

Alaska Newsreader: Special Exxon Valdez edition

Comments